SHANGHAI: China stocks edged lower on Friday but posted their strongest weekly gain in nearly two months, led by financial shares, as a ceasefire between Israel and Iran lifted investor sentiment.
- China’s blue-chip CSI 300 Index closed down 0.6%, while the Shanghai Composite Index lost 0.7%. Hong Kong’s benchmark Hang Seng was down 0.2%.
-Chinese brokerage stocks rallied sharply this week, buoyed by easing global geopolitical tensions and improved investor risk appetite, Morgan Stanley analysts said in a note.
Over a 6- to 12-month horizon, increased portfolio allocation to China appears likely, supported by improving market fundamentals and growing global investor demand for diversification, they said.
Tianfeng Securities jumped as much as 10% on Friday.
The CSI 300 Index has risen 2.0% this week, the best weekly gain since May 5, while the Hang Seng Index advanced 3.2%, its strongest week since March 3.
Onshore financial shares climbed nearly 3% this week.
China’s industrial profits swung back into sharp decline in May from a year earlier, as factory activity slowed in the face of broader economic stress.
The United States has reached an agreement with China on how to expedite rare earth shipments to the US, a White House official said on Thursday, amid efforts to end a trade war between the world’s biggest economies.
Shares of Xiaomi surged to a record high on Friday, after the company launched a new electric car model with a strong beat on pre-orders.
But this has added pressure on other automakers, with Li Auto and Xpeng down 1.8% and 3.2%, respectively.
Hong Kong’s HSCI Materials Index and mainland’s Non-Ferrous Metals Index rose 2.4% and 1.9%, respectively, as non-ferrous metal prices such as copper broadly rallied.